SPX attempted to recover some of the recent drop today but ultimately failed. The one of the last few days has been turning bearish and today was a confirmation of that, despite SPX closing green on the day.

SPX was much higher on the day and throughout the day we saw failed rally after failed rally, and each of those rallies were sold. SPX almost closed at the low of the day as a result.

Is the trend shifting, even if just for the short term, to simply selling every rip? There is certainly a bearish undertone to the market right now and it seems to be poking its head out more and more.

The daily candle is also pretty bearish today, long wick at the top really highlights the failed rally, and we also had a green day but a red candle. SPX closed lower than the opening print. We are still also stuck at the lower end of the expected move and the week is now more than half way over.

It might not be as prominent on the daily chart, but today seemed like a small bounce before the next drop. The current expectation from today’s daily candle is that we see follow through to the downside, ideally even breaking yesterday’s low.

SPX attempted to retest the grey box today as well and ultimately rejected and closed back out of it. The argument can also be made for the red trendline, which seems to be the current trend and pattern that is dictating price action for the time being.

The zoomed in view has a similar takeaway to that of the daily chart, the current expectation is that this pattern keeps playing out, especially because of the confirmation we got today.

If that is true, then 7688 should break tomorrow and SPX could be heading towards at least 7630 sooner than later.

The daily chart and the shorter timeframe charts are mostly in agreement right now, which should put a higher probability on the trend continuing. I can’t remember the last time a bearish set up actually played out the way we thought it would, but maybe this time truly is different.

My brain and eyes are processing a bearish chart, but my heart knows the amount of pain I have felt every time I chased the bearish set up. It’s quite the tug of war internally, and I am sure I am not alone in feeling that.

Is this a too good to be true set up or are we actually about to see SPX correct a decent amount?

Your guess is as good as mine, but for now I’ll trade the markets my eyes see despite my heart warning me.

Let’s find out if the dip buyers kill the bears again.

Good luck!